Mexico presses Trump to uphold NAFTA for good of both nations

Cheryl Sanders
May 12, 2017

On the administration's broader trade strategy - frequently described as an "America First" policy - Mr Ross said "the goal is to increase overall trade while reducing our trade deficit", which means reducing barriers to United States exports. He also signaled that the administration of Trump could enforce trade rules aggressively and could also insist to stop adopting the slash-and-burn approach and give fair treatment for USA goods.

Trump's version of the calls - painting them as purely coincidental - diverges somewhat from a report that the president's son-in-law appealed to Trudeau and Peña Nieto, setting the wheels in motion.

Ross, a billionaire investor, said the Commerce Department is working on some "self-initiated" anti-dumping and anti-subsidy cases on behalf of private industries that could help shield them from unfairly traded imports.

"I think between the change in regulatory attitudes which will make it easier to make big projects, and the new taxes, which will make the rates of return much better, the reduced regulatory environment, I think over time you will see increases in capex - and that in turn has a big multiplier effect through the economy", Ross said.

The White House said US President Donald Trump had so far agreed not to break the NAFTA agreement, and the leaders agreed to act quickly to allow renegotiation of the deal. And, use of US tariffs is on possible rise to penalize foreign companies, which also raised concerns of protectionism.

"There is little point to a trade agreement that is not honoured".

Mexico said that, without NAFTA, the average tariff on Mexican exports to the USA would be 3.5%, or about half the average tariff on U.S. exports to Mexico, because of the "most favoured nation" clause that would apply under WTO rules.

The US is the least protectionist of any major economy, especially compared to China and Korea, but Ross complained that any US trade action is portrayed in the media as protectionist.

Due to the Trump's vow to renegotiate out of trade deals, US trading partners have been spooked.

The US energy industry also relies on exports to Mexico, which is now the biggest export market for US refined oil products and natural gas, Smith said.

"Mexico is the largest consumer of American products, and NAFTA encourages job creation in the United States, and the USA has a moderate trade deficit with Mexico", the State Department said.

"Congressional delays are actually causing more of an import problem from Mexico than we had before", he said. A trade official from Canada called the move normal, according to Politico.

The research shows that about half of US citizens say the trade agreement is good for the USA, while 76 percent of Canadians say the agreement is good for Canada.

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